Dealers Lobby for Looser Gas Mileage Law

On the same day that a Washington-based consumer group declares Detroit auto makers stuck in neutral on fuel-efficiency improvements, a number of prominent dealers fan out across the nation's capitol to drum up support for looser corporate average fuel economy (CAFE) requirements.

The Senate approved an energy bill that would raise the current CAFE requirement to 35 mpg from the current 25 mpg standard by 2020.

Although the House withdrew fuel standards from its energy legislation to essentially postpone the debate until this fall, the National Automobile Dealers Assn. sent key members to Washington to promote a fresh legislative proposal.

That would amend the House energy bill to include a requirement that calls for auto makers to raise CAFE to between 32 mpg and 35 mpg by the '22 model year.

Dealers, auto makers and the United Auto Workers union consider the Senate's 35-mpg CAFE requirement unrealistic and say it fails to take into account consumer demand and marketplace realities.

David Kelleher, who owns two Chrysler-Dodge dealerships in suburban Philadelphia, says lawmakers lack a full understanding of what the proposal could do to the industry.

“They hear 35 mpg and that it can be done and think it's great, but they don't look at the details,” he says.

Kelleher told lawmakers a 35-mpg standard would force auto makers to adopt alternative powertrain technologies sooner than they should and the extra expense would get passed on to the consumer.

“If you raise the price of a vehicle by $6,000 or $7,000, a lot of people are going to lose their jobs.”

The newly introduced amendment to the House energy bill favored by Kelleher and other dealers would assign specific CAFE standards to different classes of vehicles, such as cars, trucks and SUVs.

NADA says such a consideration would preserve the diversity of vehicles that consumers want and give auto makers “enough lead time to develop the technology needed to meet the new standards.”

But, according to a Consumer Federation of America survey of 1,000 adults, consumer concern over gas prices has skyrocketed to 91% of all households earning between $25,000-$35,000 annually.

CFA says domestic auto makers have failed to improve fuel economy in response to rising gas prices in recent years.

Kelleher, however, says it's a mistake to think that many consumers favor stricter fuel-economy requirements.

“I still work the sales floor, and I can tell you that fuel economy is No.10 on the list (of consumer concerns),” he says.

“(Buying a car is) about vanity, comfort, convenience and utility. They'll complain about fuel prices, but they won't blame their vehicle. They'll blame the people making the gasoline.”